Why does the selling stop today? Very simple. Today is the last day for a trade to settle in September, T+3.
September is the month that the mutual funds do their tax selling. Most end their fiscal year in September. As such, they sell their dogs in September. So the selling is complete. Watch to see how $GILD and $BMY trade from here. It should improve as they were down -20% and -19%.
It was funny to see several well known analysts and media pundits recommend these names in September. They should know better.
Through 9/2 there were 4,586 stocks higher and 1,963 were lower which did not make this a huge year for tax selling. However, it was enough to cause September to be sideways to slightly lower, -1.14% through yesterday.
In my opinion, stocks to focus on for the rest of the year are stocks that are basing with heavy short interest where the short rarely make money with good fundamentals. Shorts in these names will get their faces ripped off by the dreaded Q4 Rally that materializes every year and as produced double digit gains in 2013,2014 and 2015.If you enjoy the content at iBankCoin, please follow us on Twitter